Floor Talk, December 24, 2018
Farm Markets' Holiday Schedule:
Today, Monday, December 24: The commodity markets close at noon.
Tuesday, December 25: Markets are closed all day; no night markets.
Wednesday to Friday, December 26-28: Markets have regular hours
Grab your Christmas coffee and digest these markets thoughts from one of my favorite sources from a tall building in Chicago. However, this anonymous source traded on the floor for three decades.
"I am afraid the farmer has missed their best opportunity to sell new crop in beans and corn already.. and that is the recent highs when the administration was hyping Chinese return.
The Chinese buying is only government agency buying for reserve. The 25% duties on commercial trade are still intact and we are running out of time to affect a large export trade for this marketing year. The rub comes when the US farmer will be forced to move out of soybean acres and into corn and wheat, stifling rallies in those markets.
We will start to assess this in the run up to the Feb out look meeting and March planting intention report.
Meanwhile, China apparently has lowered duties on alternative meals like rapeseed meal, and Argentine meal is cheaper than US already.
Meanwhile, government shut down is keeping tax subsidy for biodiesel on the shelf and early harvest has already started in Mato Grosso, Brazil.
There could be 10 million tons harvested in Brazil by late January, with main crop harvest starting as early as Mid- Feb. The commercial trade is typically executing exports for shipment 6 weeks ahead. In most years, 70% of the commercial bean exports are sold by the end of December.. This is our problem with prices.
Weather can still over ride the bias.. but today's weather looks for improvement in SA.. and Chinese continue to take actions to avoid US," he said.
At the close:
At the close, the March corn futures finished 3/4¢ lower at $3.77 3/4. May futures finished 1/2¢ lower at $3.85 3/4.
January soybean futures closed 3/4¢ lower at $8.84. March soybean futures closed 3/4¢ lower at $8.97.
March wheat futures settled 2 1/2¢ higher at $5.23 1/2. March soymeal futures closed 1.70¢ per short ton higher at $311.80. March soy oil futures settled 0.14 lower at 28.03¢ per pound.
In the outside markets, the NYMEX crude oil market is $3.06 lower, the U.S. dollar is lower, and the Dow Jones Industrials are 653 points lower.
In early trading, the March corn futures are 1 1/2¢ lower at $3.77. May futures are 1 1/2¢ lower at $3.84 3/4.
January soybean futures are 1 1/4¢ lower at $8.83. March soybean futures are 1 1/4¢ lower at $8.96.
March wheat futures are 1/4¢ lower at $5.13.
January soymeal futures are 1.00¢ per short ton higher at $311.10. January soy oil futures are 0.01 lower at 28.16¢ per pound.
In the outside markets, the NYMEX crude oil market is $1.11 lower, the U.S. dollar is lower, and the Dow Jones Industrials are 700 points lower.
Corn= Down 3¢.
Soybeans= 3¢ lower per bushel.
Wheat= 2¢ lower.
Crude oil= 1.11¢ lower
U.S. Dollar= Lower
Dow= Down 700 points
What do you know?
Re: Floor Talk, December 24, 2018
This is what I found out.
Michael Rusch, Regional Sales Director- Ag/Commercial | Stewart-Peterson, says that corn futures saw technical breakdown yesterday, which saw extended selling as prices pushed to their lowest level since the last week of November.
“The market is rebounding today on short covering, with the Mar contract holding the key 3.75 psychological support level. Corn futures are seeing strength despite outside markets, as well as selling pressure in other grains. On the demand front, the USDA announced a sale of 8.7 million bushels to unknown destinations for the 2018/19 crop year. The demand pace remains strong, and that is a bullish factor supporting corn price,” Rusch says.
Rusch adds, “Bean futures continue to see selling pressure, as prices are challenging key-moving average support near the 8.85 area in the Jan contract. Despite seeing China step back into the soybean market, sales to the world's largest importer of beans have been less than impressive overall, as the market has handled a "buy the rumor, sell the fact" mentality.”
The USDA did announce an additional sale of 4.2 million bushels to unknown destinations for the current marketing year.
“Despite ramp up in export sales movement in recent sessions, the pace is still trailing USDA projections and may lead to an additional reduction of export demand goals in the future, therefore carrying an increasing carryout.
Soybean futures are also seeing pressure as forecasts in South America are bringing potential beneficial rains to some key areas that need it, as they start to develop their crop for this year,” Rusch says.